Volvo Cars and Geely Auto to Deepen Collaboration

Dubai, UAE, 10 March 2021:  Al-Futtaim’s Trading Enterprises – Volvo today announced that Volvo Cars and Geely Auto have agreed on a wide-ranging collaboration that will maximise the strengths of the Swedish and Chinese automotive groups, delivering synergies in powertrains, sharing of electric vehicle architecture, joint procurement, autonomous drive technologies and aftersales. This includes:

• Powertrain operations to be combined in new company focused on next-generation hybrid systems and internal combustion engines
• Expanded use of shared modular architectures for electric vehicles (EVs)
• Enhanced collaboration in autonomous and electric drive technologies
• Joint procurement to cut purchasing costs
• Lynk & Co to expand globally by utilising Volvo distribution and service network
• Companies to retain independent corporate structures

Following a detailed review of combination options, Volvo Cars and Geely Auto have concluded they can secure new growth opportunities in their respective markets and meet evolving industry challenges through deeper cooperation, while preserving their existing separate corporate structures. The deeper collaboration will enable existing stakeholders and potential new investors in Volvo Cars and Geely Auto to value their respective standalone strategies, performance, financial exposure and returns. We will also have the opportunity to explore capital market options. The collaboration will be overseen by a new governance model, supported by Geely Holding, the lead shareholder in both companies. Volvo Cars and Geely Auto confirmed the combination of their existing powertrain operations into a new standalone company. The company, expected to become operational this year, will provide internal combustion engines, transmissions, and next-generation dual-motor hybrid systems for use by both companies as well as other automobile manufacturers. The companies are planning to share and jointly source batteries, electric motors and connectivity solutions that will generate valuable synergies. This will include the joint development of a world-leading autonomous driving (AD) solution under the lead of Zenseact, Volvo Cars AD software development company. The two companies, which are planning to share the new SEA and SPA2 electric architectures among their brands, have launched combined efforts to drive speed and efficiencies in the development of hardware and software for the next-generation world-leading modular EV architectures. Intended sharing of platforms and architectures between the companies will drive additional synergies and allow for an expansion of product portfolios across the Volvo Cars, Geely, Lynk & Co and Polestar brands, and external partners. Leveraging Volvo Cars’ existing distribution and service network, the two companies will also collaborate on the global expansion of the jointly owned Lynk & Co brand. The collaboration agreement has been welcomed by Li Shufu, Chairman of Geely Holding, the parent company of Volvo Cars and the largest shareholder in Geely Auto. A subsidiary of the Al-Futtaim Automotive Group, Trading Enterprises was established in 1970s in Dubai and is the exclusive authorized distributor for Volvo in the UAE. It is empowered by a highly skilled and trained professional team to provide a complete car buying experience. Al-Futtaim Automotive is one of five divisions within the Al-Futtaim Group which provides quality products and services that enrich people’s lives and aspirations each and every day. For more information on Volvo’s online services in the UAE, visit https://www.volvocars.com/en-ae/online-services